St. Joseph’s College of Commerce B.Com. 2015 Taxation – I Question Paper PDF Download

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ST. JOSEPH’S COLLEGE OF COMMERCE (AUTONOMOUS)
END SEMESTER EXAMINATION – SEPT/OCT. 2015
B.COM (T.T.) – V SEMESTER
C2 12 501: TAXATION – I
Duration: 3 Hours                                                                                             Max. Marks: 100
SECTION – A
I) Answer ALL the questions.  Each carries 2 marks.                                        (10×2=20)
  1. How do you ascertain the residential status of a Company?
  2. Distinguish between exemption and deduction.
  3. Define Assessee.
  4. Explain provision in respect of commuted pension with regard to non government employees.
  5. X took a loan of Rs 25 lakhs from his employer @ 5% p.a  where as the SBI rate is 12%. Determine the value of taxable perk.
  6. State the provisions of perk w.r.t transfer of electronic asset.
  7. How do you tax the following:

a)      Club facility provided

b)     Free use of laptop and mobile
  8. Give the conditions to be satisfied for unrealized rent deduction.
  9. How do you tax arrears of rent recovered in the previous year
  10. Give any four incomes which are fully exempt.
SECTION – B
II) Answer any FOUR questions.  Each carries 5 marks.                                      (4×5=20)
  11. Compute the income from house property of Mr. Anil and Mr. Sunil from the following information for the year ending 31st March, 2015:

  1. Mr. Anil and Mr. Sunil are brothers and they have inherited equally the house property from their father.
  2. Rent realizable from the property is ` 27,000 per annum.
  3. Municipal Taxes (To be borne by the landlord) are  `9,000 per annum.
  4. The property is on a leasehold plot of land and the annual lease rent is   ` 3,000.
  5. Rent collector is paid   `100 per month.
  6. Property was mortgaged for taking a loan of   ` 50,000 at 10% per annum for the purpose of partnership business of Mr. Anil and Mr. Sunil.  The loan was taken on 1st October, 2011.
  7. One of the Flats in the Building fetching monthly rent of   `500 was vacant for two months.
  12.

 

 

 

 

 

 

 

 

 

 

 

 

 

 Mr. V Raju a surgeon in a government hospital retired on 31.7.2014.  He joined as adviser (part time) from 1.9.2014.  His other particulars for the year ending 31.3.2015 are:

 

 

 

  `
Salary during government service 1,44,000
House Rent Allowance (living in own House) 24,000
Gratuity received 2,72,000
Leave encashment on retirement 1,20,000
Commuted value of pension 1,50,000
Expenses on Books and Journals 6,000
Pension 1,08,000
Amount received as adviser 70,000

Compute his income under the head ‘Salary’

 
  13. Mr. R is working with Reliance Industries Ltd. at Ahmedabad (population above 25 lakhs).  The particulars of his salary income are as under:

  `
Salary 30,000 p.m.
D.A. (Treated as part of salary for calculation of Provident Fund) 5,000 p.m.
Bonus 10,000
Commission 2,00,000
Employee’s and Employer’s contribution to RPF (Each) 3,000 p.m.

The employer has provided a rent free house.  Calculate the value of the perquisite of rent free house it:

  1.  House is owned by employer and its FRV is   `45,000 p.a.
  2. House is hired by employer at   `4,000 p.m.

 
  14. Mr. B. married citizen of India left for Germany for the first time on 15-9-2013 on a business trip.  He returned to India on 5-6-2014.  During his absence from India he maintained a dwelling house for himself in Calcutta.  What will be his residential status for the assessment year 2015-16.
  15. Give 5 examples each for Capital Expenditure and Revenue income.
  16. Mr. G retires on 31-10-14 after 20 years service and received Rs. 1,80,000 as leave encashment for 12 months. His employer allows him one and a half months of leave for every one year of service. He has already encashed leave for 18 months. His salary for 13-14 was Rs. 15,000 and from1-4-14 it was raised to Rs. 16,000 p.m. Compute his taxable amount of leave encashment.
 

SECTION – C
III) Answer any THREE questions.  Each carries 15 marks.                                (3×15=45)                                                                                                
  17. Mr. Sri Kant owns two houses, the particulars of which are given below for the previous year 2014-15:

Particulars House A

`

 House B

`
Rent Received NIL 1,72,000 p.a.
Standard Rent 5,00,000 p.a. 1,50,000 p.a.
Municipal Valuation 4,90,000 p.a. 1,60,000 p.a.
Fair Rent 5,00,000 p.a. 1,80,000 p.a.
Municipal Taxes paid during the year 49,000 p.a. 16,000 p.a.
Fire Insurance (due) 5,000 p.a. 3,000 p.a.
Ground Rent paid 4,500 p.a. 3,900 p.a.
Interest on money borrowed during 98-99 for construction of houses (50% paid) 36,000 p.a. 48,000 p.a.
Unrealised rent (Pertaining to this year) NIL 6,000
Nature of occupation Self occupied Let out

Compute income from house property for the assessment year 2015-16 assuming that the Assessing Officer is satisfied with the non-recovery of rent.

 
  18. Shri Sukhwasi is Secretary to Hamesha Nuksan Ltd. Pune (Population 20 lakhs) and for the period between 1.4.2014 and 31.3.2015 has received the following salary and other payments from his company:

`

  1. Salary
 18,000 p.m.
  1. Dearness allowance
 2500 p.m.
  1. City compensatory allowance
 800 p.m.
  1. Entertainment allowance
 12,000 p.a.
  1. Commission on sales achieved by him
 24,000
  1. Rent –free accommodation of building (furnished) for which Co. pays a municipal tax on  ` 60,000 per annum and furniture value is   ` 1,20,000.
  
  1.  Medical bills reimbursed by company.  Treatment taken from a private hospital.
 2,000
  1. He is provided with a car of 1.8 lt. capacity which is partly used for personal and partly for employment purposes.  During the year company incurred    `24,000 on maintenance of car.  Normal depreciation on car is  ` 30,000 and driver’s salary is   ` 12,000 p.a.  It was agreed by the Assessing Officer that 40% of the car time is used for personal purposes.
  1. As per terms of agreement his professional tax of ` 2,000 was paid by the employer.
  1. During the year he travelled in connection with his job and was paid   `16,000 as travelling allowance and  `  12,000 as daily allowance.
  1. He and his employer contributed  ` 35,000 p.a. (each) to R.P.F.

Compute his income under the head Salaries.
  19. Following are the particulars of income of Mr. RTM for the assessment year 2015-16:

      `
  1. Income from business in Mumbai
 80,000
  1. Income from house property in Pune
 20,000
  1. Pension from former employer for service rendered in India but received in U.K.
 24,000
  1. Profit from business in UK but controlled from Mumbai
 1,60,000
  1. Dividend from an Indian company but received in UK
 18,000
  1. Income from agriculture in Nepal: received there but later on remitted to India
 60,000
  1. Interest on Bonds issued by U.K. Government out of which 50% is received in India
 40,000
  1. Past untaxed income of 2011-12 to 2013-14 brought into India during 2014-15
 4,00,000
  1. Income from house property in U.K. and donated there to a notified charitable institution
 70,000

Compute the total income for the assessment year 2015-16 if Mr. RTM is (a) Resident,  (b)  Resident but not ordinarily resident; and (c) Non resident.
  20. Explain in detail   Provision of  SPF, RPF, URPF and PPF.
  21. Dr. Nagendra is a renowned medical practitioner who maintains books of account on cash basis, furnishes receipt and payment account for the previous year 2014-15:

Receipts ` ` Payments ` `
To Balance b/d   14,000 By Rent of clinic    
To Consultation Fees:                2013-14 600  
           2013-14 3,000               2014-15 4,800  
            2014-15 15,000               2015-16 600  
2015-16 2,000       6,000
    20,000 By Electricity & Water   2,000
To visiting fees   30,000 By House hold Exp   7,800
To Loan from Bank   25,000 By Purchase of Professional Books   4,000
To sale of Medicines   60,000 By Collection charges on Dividend   100
To Gift & Presents   5,000 By Motor Car purchased   30,000
To Remuneration from Journals   6,000 By surgical Equipment purchased   4,800
To Dividend   10,000 By Income-tax   10,000
To Interest on Post Office Savings Bank A/c   7,000 By Salary to Staff   15,000
      By Life Insurance Premium   15,000
      By Gift to wife   5,000
      By Interest on loan (for profession)   2,000
      By Car expenses   15,000
      By Purchase of Medicine   40,000
      By Balance c/d   2,300
                        Total   1,77,000     1,77,000

Compute  his taxable professional income for the assessment year 2015-16 after considering the following:

  1. 1/3 of the use of car relates to his personal use.
  2. Depreciation on car is to be allowed @ 15% and on books @ 60%.
  3. Gifts include  `3,000 from patients and   `2,000 from relatives.
  4. Closing stock of medicine is   `5,500

 
SECTION – D
IV) Case Study                                                                                                                     (1×15=15)                                                                                          
  22. From the Profit and Loss account of Mr. Ramanathan for the year ending 31-3-2015.  Compute his business income:

  `   `
General expenses 63,400 Gross Profit 2,65,500
Bad debts 22,000 Commission 18,600
Provision for bad debts 21,000 Brokerage 27,000
Insurance (House) 600 Sundry receipts 22,500
Salary to Staff 36,000 Bad debts recovered (earlier disallowed as deduction) 1,000
Salary to Ramanathan 22,000    
Interest on loan (Bank overdraft) 62,000 Interest on deposit with a Trust 15,000
Interest on loan taken from Mrs. Ramanathan 4,000 Interest on units of U.T.I. 13,000
Interest on capital of Ramanathan 13,000 House Property 12,000
Depreciation on building 60,000    
Advertisement expenditure 8,000    
Contribution of employees RPF 12,000    
Net Profit 50,600    
  3,74,600   3,74,600

Other information:

  1. The amount of depreciation allowable on building is  `40,200 as per Income –tax Rules.
  2. Advertisement expenditure includes ` 5,000 being cost of advertisement in newspaper.
  3. Income of  ` 10,000 accrued during the year is not recorded in the Profit and Loss Account.
  4. Ramanathan pays  ` 12,000 as premium on own life insurance policy of    `90,000
  5. General expenses includes  ` 4,500 given to Mrs. Ramanathan for arranging a party in honour of a friend.
  6. Employer’s contribution to provident fund for last 2 months @  ` 1,000 p.m. has not been paid to appropriate authority within due date.

 

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